City Initiated Land Use Re-designations (The Main Streets Initiative) - A Transformative Event?

The inner city builders have had major difficulty in acquiring development property in the SW and NW locations where infill building is in greatest demand.  This is as an issue of artificial scarcity versus a true shortage of space.  There is and will continue to be plenty of land, but up until recently there has been a massive disconnect between the type of development land in demand, and the type available given the land use regulations.

In large part, the development land that comes available is locked into a tightly defined land use district, RC2. This is basically a land use that allows single homes and semi detached homes, nothing else is possible.  Over time this has led to a real shortage of move up type properties that are larger and more family oriented than condo apartments (lots of those, endless supply), and pricey detached homes (young families can rarely afford these - also good supply, particularly during the recession).  The multi-family zoned land has been at times virtually impossible to purchase, and inventory non-existent, or only listed for sale at pricing levels that would make the land seller the sole beneficiary of any future redevelopment proceeds (and this shortage really feeds into the realtor behaviour regarding the sale of development property for multi family projects).

While a huge amount of R2 semi-d development has taken place, including by yours truly, the overall land use of communities has really become archaic in the context of a changing city.  You could argue that the builders are now designing homes just to comply with city bylaws in the multi-hundred page zoning bylaw.  It appears that the city plans examiner is the end customer of the house based on where design effort is directed, rather than an actual family that wants a home in the inner city.

I think this Council has, more than any previously, latched on to this huge disconnect to the type of City that currently exists, and the transformation that has to take place to welcome the next one hundred thousand, or even half million Calgarians.  Under current demographic and growth pattern, Calgary would just sprawl endlessly in an anonymous, poorly serviced, culture deficient wasteland of suburbia, with some isolated pockets of exceptional livability.  And based on the cost to service these distant communities, the City would go broke while getting bigger.  It seems that the future development needs to be a net positive to the City, rather than drain the taxes out of the desirable areas to subsidize a kind of hamster wheel car based sprawl that brings in more traffic and dilutes the capacity of the entire transportation network.

Obstacles remain in place to growing Calgary smarter.  The biggest issue is the individual community area redevelopment plans (ARP).  These map and policy documents basically lock in a land use from when Calgary was half its current size and ideas were very different on neighbourhood design. The ARP has become a very valuable tool to stop any kind of change, even sensible changes.  Many areas with redevelopment potential would decay under the confines of the land use allowed in an ARP, and many outspoken community residents would resist any change to the ARP through a contentious public hearing process (I know all about this too).  Updating an ARP is a difficult process, many in the community want to just change the date on the cover page and use that new ARP to continue to block redevelopment perpetually.  

The City planners have become way too smart to get bogged down in multi-year ARP reviews.  Instead they brought in a process called the Main Streets Initiative.  This allows re-designation of major chunks of communities along important routes, and it brings in new mixed use districts not previously in existence in Calgary.  The mixed use district is perhaps the greatest deficiency in Calgary today based on the restrictive bylaws of the past.

The biggest winner from the mass re-designation of communities along the main streets could be Rosscarrock and Shaganappi, followed by Killarney and Glenbrook (not much of change at all to Glenbrook, which is unfortunate, because some of the heart of Glenbrook is truly hideous).  There could be some major redevelopment investment in these communities, just from the introduction of the new zoning classes.  I believe this could be a transformative event in these communities during the next upswing in the economy.  This new land use will provide massive new development options within the existing communities and attract major dollars to revitalize some pretty ugly places, using new planning ideas and concepts.  Areas of decayed old bungalows that were not good redevelopment sites could see mixed use and townhouse projects, and a boom in row housing and affordable rental and retail housing can now happen.  I am a huge supporter of this initiative.  I am almost shocked at how quickly this is moving, and how little I knew about this project up until the last month or two.  I likely misspent almost $15k re-designating a property within the new map area to be re-designated by the City anyway.  It was like the City Council did not even know it was going to be re-designating areas that another department already had created detailed new land use maps for.  Very bizarre, and the community fought as hard is it could against re- designating one lot in November, just to find out in January that 100's more would be changed in an identical way? Given the level of opposition to one tiny property, you'd think that 100x this amount of change would be met with an angry mob outside City Hall? Hasn't happened yet. 

You could say the City kept its maps pretty quiet.  Just last summer I attended a meeting on this initiative, but no real information was provided to the Killarney Development Committee.  The map availability shows just how significant the modernized land use will be to these communities.  If this effort works its way to a Council Vote and public hearing, I will be there to show some support.  Here is a map showing some of the potential transformation that can take place along the 17 ave and 37 st corridor.

The grey areas are mostly R1 and R2 zones, and some are in really rough shape.  the brown is R2, the purple is MC1 (think 4 level condo), the Tan and Blue (not shown here) is Mixed Use Commercial of varying intensity (commercial main floor, housing on upper levels), and the Yellow is a row house district. This is one of three new maps distributed by the City. If this passes, I am predicting this will transform these areas (for the better), over the coming decade.   

Finishing Selections continues

I have recently put some more energy into finalizing some of the finishing selections.  It is nice to have the material selected and possibly even ordered once the drywall stage of the project is beginning.  Delays and back ordered tiles are really common in the summer months.  The Italians are notorious for not working at all during the summer months, so it is almost impossible to be certain tile deliveries will be possible during July and August.

Fortunately this project won't run into those issues, we've got another project to start this summer so we need to get the semi-d wrapped up by then.  I have selected the kitchen cabinetry, countertop, appliances, flooring, tile and even some lighting already.  We will be in good shape to prepare a very attractive show suite.

If you narrow your floor tile options to four from hundreds, it makes for an easier choice

I've looked at all the options and am using the same cabinet pull as last time - no reason to switch.

Are Realtors Snakes?

The short answer to this is no.  I have some good realtors who are not reptilian that I'd be happy to put you in contact with.  However, the long answer is many realtors exhibit strong snake like tendencies.  Realtors have shown some of the worst ethics of any profession I have encountered.  Realtors take a good chunk of equity in every transaction, and for mortgage payers, the equity can be very difficult to accumulate yet be clawed away in interest, fees and particularly transaction commissions very quickly.   

Realtors are one of the least loved professions among the general public for commonly understood reasons, and real estate sales as an industry, unlike say taxi medallion owners (another detested class), has not been disrupted nearly enough by technology.  

Real estate sales data in Canada as a whole are highly lacking in transparency vs. the USA.  The profession lacks a real code of conduct for integrity, despite its claims to the contrary.  As shown by previous blog postings, the agents are driven to be dishonest when selling houses.  Agents appear to be rewarded more by dishonesty than by honesty when marketing development properties.  

I contacted a broker owner with decades of experience and who manages 171 real estate salespeople.  I asked a simple question, what is the minimum ethical standard for honesty in real estate listing descriptions for development property?  

The reply was that agents should not be dishonest in listing development property but the buyers should do diligence.  This weak answer is the best I could get.  Basically the broker is saying that agents 'should' be honest, but it is ok to be dishonest, because regardless of what the agent says the buyer needs to practice diligence.  There appears to be no accountability for real estate agents in Calgary who publish dishonest material regarding property they are trying to sell.

What value does a dishonest realtor bring to a deal?  Why does a dishonest realtor earn a commission?  These are some existential questions that won't be answered on a blog post. I'd urge caution in any dealing with an agent...

Beware the snake like tendency of the real estate agent!

Dishonest Real Estate Agents? The endless series of factually incorrect listings continued...

UDATE 1: I find it hilarious when failed developers attempt to resell their property that was purchased at the peak of the last up-cycle a few years later, in a recession, and tack on a couple hundred grand for their trouble (you know the 'trouble' they had, as in they couldn't develop their property so they need to sell it). In this case the land value has apparently increased by $250k in the last two years, that'd be about $10k per month, $342 per day, every day through the recession...hmmm.

UDATE 2: City tax valuations are a curious matter.  Here we have a property that sold for $1.15M in 2014.  You'd think that the City assessor would take that as the value for tax purposes.  But no, they don't use market values, they use some hybrid of what a place was worth last July in its current condition (?).  I have had demolished houses assessed upwards, this seems impossible because the current condition was demolished and last July it was a shack.  Regardless, the City only values this property at $755k on its tax roll.  This is way too low, another example of how the cash starved city undertaxes certain classes of property, and rigorously taxes other classes.    

Frequent visitors to this blog will know how I enjoy pointing out how unethical those parties involved in land deals tend to behave.  In a way I am sympathetic, because these are big ticket items that are changing hands, the commissions are huge (and can be for very little work on a land deal), so all parties are truly incentivized to act as poorly as possible on behalf of the seller.

The property we are featuring today is a stellar example of the way our local real estate professionals will go to almost any length to disguise the truth when reselling failed development sites.  The location is great - note the underlying land is good, it is the deal that is terrible, and those people representing the deal that really sour me on the real estate sales profession.  Lets look closer at the details of our case today;

• address - 615 2 ave NW - sunnyside
• size - 62 x 120 ft site - great size for building on
• zoning - MCG - this is a ground oriented multi family site that offers good development potential, so the land use is fine
• price - originally asking $1.5 million, now down to the bargain price of $1.4 million
• what the realtor chose to misrepresent- claims a development density of 5 units
• what the realtor wants the buyer to not know - the owner has already tried to permit a 5 unit townhouse project, met with significant resistance at the community level because the planing department authorized a project with relaxations (otherwise project was impossible to develop), had the project permit appealed, and lost.  This is definitive proof that due to parking and other concerns a unit arrangement of 5 on this lot will not work without major clean sheet redesign work, and even then a project appeal will likely tie up the builder for months.
• how to get a similar project permitted? -  It is conceivable this project would be re-permitted again with a concrete underground parking garage, that would offer six or more parking spaces.  This would be a huge risk from a cost benefit perspective, and likely render this project far from economic, especially at its inflated asking price of $1.4M.

In summary, to misrepresent about how this is a 5 unit development project (without mentioning this property just failed as a 5 unit development), to price it such that it is not remotely viable as a project if only 4 units are allowed (I'd argue not viable even at a density of 6 at the asking price), and to neglect to mention how damaging the community led opposition and appeal of the project was to the land value is highly suspect.  

I'd love to own this lot, but I can't value it above $800k.  Even at $800k I'd be concerned about the viability of the project.  Perhaps another builder could pay more, or somehow make it work, but $1.4M is a crazy number.  

Best case for this one is it somehow gets auctioned off in a judicial sale.  If that happens, I will be there with a bid, ready to take it as is, where is.  This is another property that will be interesting to see how it unfolds if it is sold.  I will update the blog when there is any update to the status of the sale.

Note to the City - generally you are so obscenely cash hungry you'll go out and reassess my projects right after I start building to increase my assessment.  Yet, here we have a property owner claiming his land is worth $1.4M, yet is is taxed at a value of only $755k. I'd love to see this property get re-assessed at its full asking price.  The City tends to value older properties far too low, and the City budget really suffers for this.  It would be hard to appeal a high tax assessment for a listed property such as this one given its recent sales activity.

Mechanical penetrations

With a high grade at the back of the house where the mechanical equipment sits, we were unable to use a wooden rim joist, so we actually need to core our mechanical penetrations through solid concrete.

The concrete coring work is commonly done for plumbing work and of course enlarging basement windows.  The holes I needed were more like 3 inches diameter, so they go pretty quick.  Having a water injection system on a powerful drill with long bits makes the job possible.  I like to use the guys from ABC coring.  They once again proved themselves to be excellent operators.

A bunch of holes are cut through the concrete wall, these are for furnace intake and exhaust, gas line, and electrical conduit for the panel service and communication wires.  

Pot light layout

With the project gaining a little momentum by having multiple crews on site, I was pleased to see some more progress today with the electricians beginning work on the main floor and the mechanical work complete on one house.

By the time I made it to site the electricians had already put up all the housings for the 4 inch LED pot lights.  Pot light layout can be tricky (placing lights in the centre of a door opening vs. centre of a hall, how many pots, how far from the wall, etc).  We went with a common arrangement of four in each room, plus a few extra in the hallway spaces and beneath the stair landings.

Having 20 pot lights on a main floor makes adjusting and controlling where the light is very easy. The biggest challenge of the new owner is to remember what switch controls what set of lights.  The rough in of the LED housing is quick because the housing is essentially a holder for the light that goes in later and acts as a template for a drywall cutout tool.  The wire is left free floating in the housing, it will be all connected at a much later date when the house is nearly done.

These six pot lights will be on two different circuits.  generally we try and get the pots to line up across multiple rooms.  These pot arrangements look very different after drywall than they do at this framing stage.  Against a continuous white surface of ceiling it tends to look poorly if the pots are staggered.

Selecting Interior Lighting

Recently the selection of lighting fixtures for the interior and exterior of a custom house has become easier, and possibly more economical.  In the past the modern looking fixture tended to be priced as a hand made art piece rather than a mass produced consumer good.  It was tough even to find a fixture that didnt look like a brass gas lantern from the 19th century that didnt cost a huge sum or needed to be handmade in Europe.

While it remains very possible to spend the entire project lighting allowance on a single piece, it is also more viable to select all the bathroom and pendant lighting (most other lights these days are pot lights) and stay on budget while sourcing clean lined contemporary looking pieces.

Competition among the manufacturers has created a huge task for the builder in just narrowing down the type of fixture to buy from all the options. Lately the big chain hardware stores have become involved with bigger and far nicer lighting departments.  Ordering from those stores from the comfort of your home computer is even an option.

Despite the various options and suppliers, I prefer to source my lights from a store called Dhillon lighting in the NE part of town. They have a great catalogue to choose from and are good at making sure the builder gets his quantities delivered on time.  

It is just about that time that I need to have the finishing items organized for my current project.  Given the nature of the project is a so called 'spec-custom', I like to preselect my finishes according to a contemporary but neutral palette, and aloow my buyers to make some alterations provided they arrive early enough in the process.  Having one person in charge of finishing selection is a time saving approach, and lends itself to having the end product show well (and the show home is the all-important tool used to sell homes in Calgary).

Lots of options at the lighting shop.  In a few years everything will be LED but until then we can still find some really nice contemporary fixtures for reasonable cost.

Post vacation update

Good progress was made while I was away.

Framers have 90% of the basement framed and the remainder can be done after the duct runs are finished.  

Electricians snuck in a little early and did both top floors.  They will be back later on this week. 

Plumber has made further progress and can do his basement connections. He can start gas work once the ducts are done below. 

Sheet metal crew is complete upstairs and is placing the first furnace.   He should be totally done by the end of the week. 

the project engineer can be called to inspect the structure.  

Surveyor has taken height measurements of the roof so we can ensure compliance with the permit  

shingles and exterior work needs to be finalized with the contractor. 

appliances have been quoted and likely accepted.  

drywall needs to be quoted and agreed upon soon.  A few quotes are needed as the first was far over budget. 

This all adds up to a busy week for me to organize and ensure continuity as we move through the trades and into the inspection stage.  If every week was this productive I would go on vacation more often.  

Furnace is paced and ductwork moving along nicely  

The tin and abs pipe is being tucked away just as I like it to be done.  

The heating contractor is using some 4 and 6 inch ovalized duct when necessary.  This makes using every partition wall possible to hide the tin and have the returns within the same wall. 

While I've Been Away

Previous family vacations haven't led to scheduled work progressing as planned. I do recall a family trip to Costa Rica where as soon as I left it appeared all work just completely ceased.  

This time I had arranged a significant amount of sensitive work to take place - in all four crews were organized and very significant amount of work was booked (basement framing, plumbing, electrical start and full hvac rough in).  

These are among my most reliable contractors so by Thursday of the week I was fairly curious to find out what was happening. As I found out a bunch of little things were going wrong but most of the big stuff was working out.  I'll catch up with the project Monday morning and work out a way to resolve any unhappy surprises.   

What is wrong with this picture? The wiring and plumbing for the laundry is going in backwards.  Fortunately the sheet metal installer sent me a text and we were able to start fixing it before we layered on more errors.  My inner control freak is having a hard time being so detached from the project.  

Arizona construction

I stumbled across a suburban tract house development in an east Phoenix area called 'Ironwood Crossing' built by Fulton Homes, self described as one of Arizona's biggest builders, while hiking in the nearby San Tan Mountains. 

Luckily I was able to chat with a company project supervisor in charge of 47 detached houses to learn some detail about how they build.  Fast, cheap and large is how I would describe local building technique. The finished homes look fairly similar to what you'd find deep in Calgary suburbia, but the similarities end there. There is hardly any commonality in construction cost or technique vs infill housing in the Calgary inner city.  A lot of this is a function of climate.  One product they wouldn't use is an asphalt shingle, they use a very durable concrete tile for protection of the roof.  There are a lot of ways they save time and money in this area, some examples are;

1.  Pads are poured for the entire house and garage in a single pour. The mild climate allows a type of pour that would not meet Calgary code for a detached garage pad in a laneway. No basements are excavated or poured.  Cost saving is significant vs a home in a frost zone (machinery, trucking, backfill, concrete, cribbing, engineering. etc). 

Pad is ready for framing. I guess you could say plumbing is done as well. Plumbers must like these bungalow jobs. 

2.  Services are shallow and already in place.  In the established communities in Calgary a builder can spend $30k getting sewer and water, gas and electricity installed. In Arizona the cost is a fraction of that.

3.  Framing a bungalow takes a few days (not weeks) and all framing is 2x4 material. I couldn't get an answer on the price to frame a bungalow and cost of a lumber package. If I had to guess I would say less than $15k per home. My recent semi detached project was in the $75k range for labour and lumber, two homes.

Day 1 of framing - there may only be a few more days...

3. Exteriors are all stucco and roof material is a concrete tile rather than asphalt shingle. They apply a 1 inch styrofoam to the wall and then a light gauge wire, almost like a chicken wire and then sand/cement stucco. They don't appear to smooth the finish or apply an acrylic coat. I wasn't particularly impressed with the stucco product, but I'm sure it works well in the dry heat.

This one is ready to stucco. Water penetration in windows gets some attention but it doesn't rain enough to be a serious worry.  

With a limited amount of customization these homes are built fast and sold for a low price, around $250k, and a few years ago were only worth $150k. The finished bungalow is a lower cost than just the land value of any inner city property.  The location is sort of terrible, I think I will stick with North Scottsdale and the high desert boulder fields if I was to build a house in Arizona.  But building this quantity of affordable homes is a real achievement. Can we learn anything from this to apply to making inner city Calgary more accessible?  

Mr. Money Mustache - Doable in Calgary ?

Expat Canadian and world famous blogger Mr. Money Mustache was featured on the Tim Ferris podcast this week.  I've often wondered if his approach to low cost living and retirement is possible in Calgary. 

Short answer is no, Calgarians would need to relocate elsewhere. 

He lives in Longmont Colorado, a small city with a mild climate (could have selected anywhere in the US or beyond). This makes it a lot easier to bike everywhere plus his dollar stretches much farther for anything from food to cellular bills. Much of this doesn't work in Canada. His family of three can live well on just over $20k per year.  I'll spend that much this year in property tax.  A house in the kind of neighbourhood he espouses (good neighbours, convenient location, ability to make renovations and efficiency upgrades dictates you'd have to live in the inner city and spend at least $600k on a house) could have been found in Longmont for 1/3 of that when he bought his house. Nevertheless his blog and perspective are interesting and enlightening. I'd highly recommend a listen and a review of his blog archives.  

Check out the episode at https://itunes.apple.com/ca/podcast/the-tim-ferriss-show/id863897795?mt=2&i=1000381189204

Cost of living - Calgary makes no 'cents'

I was considering a Calgary property that I'd like to develop that came to me in an email just as I was looking at a north Scottsdale property in a scenic high desert Troon community. 

Conpare and constrast the options;  

Calgary lot - 50 ft, nice Killarney location. needs to be divided into two 1900 sw ft, 25 ft wide semi detached new houses. Land value 650, finished home value maybe 850 (otherwise builder is in trouble). 

Troon lot - 2.5 acre high desert view lot surrounded by scenic desert landscape and detached (1.5 m plus) luxury mansions. Land value 500.   

Calgary seems strangely out of touch with other parts of the world, including those with less erratic economies, a better currency and climate, and lower cost of goods and services of almost any category you could imagine.   The explanation for much of this is attributed to government policy that keeps Calgary costs higher while also handicapping private sector solutions.  Combine this with a tougher climate and costlier construction techniques and the end result is Calgarians pay too much for housing, need higher wages to survive, and thus a negative feedback loop permeates the entire economy.  

Live near the base of this mountain trail in a southwest style bungalow for the price of a semi detached calgary property.

Electrical planning

With framing wrapping up we can plan for some work to start next week.  This will give the trades' some work to do while I am away.  I met the owner of the electrical contractor I have hired on the site and we went over the install in a comprehensive way.  

Key decisions made relate to more than just how many pot lights and where they go.  We look at switch location, stair lighting to meet code, smoke detectors, and so on.  The electricians are rarely involved in this sort of project at the permitting stage.  The drafting company puts together a drawing but it doesn't really reflect how install is planned at the level of an electrical contractor.

This install will feature a fair bit of LED pot light material on the main floor.  It is much easier to put a few pots in the ceiling than it is to try and generally fail to centre a fixture over a kitchen table.  Here is a photo of a typical wiring plan that we modify during the site meeting.

A lot of pots goes into a typical house project.  Common sense tell us to reduce the complexity and number of 3 way switches shown here.

Misleading MLS land deals...continued

UPDATED - see the May 13 post on this property.

This is the latest in a never ending continuum of misleading land deals advertised on the MLS by the local realtors.  I remain firm in my belief the realtors should know better than to do this and should be held to a higher standard of accountability.  The listing featured today is from a realtor I actually know, and I believe he does know better, but chooses to do these misleading listings anyway.    

Basically the lot is an oversized corner on a busy road in Killarney.  A large inner city builder bought it a few years ago for about $650K and tried to rezone it for multi family use (and failed).  It is actually an ideal multi family redevelopment site due to its size and position on the block.  The land use re-designation application met with an angry horde of nimbyism and the Council at the time voted against it.  This was a poor choice by Council, and since then Council has made some significant progress in this area.  The local Councillor voted in favour of the re-designation (but I don't recall the remaining vote split).  

The biggest issue may have been the plan for six townhouses presented by the builder.  Perhaps four or five would have been less vigorously opposed.  The local residents, for whatever nimby reason that is most trendy, felt that it should only ever be redeveloped as a duplex.  There is zero business case to redevelop the site as a duplex, so this will not happen.

The listing agent basically claims what was voted against before would now be permitted (same Council), and indicates the project is a great six unit development prospect at a reasonable price. Unfortunately they have raised the price by $200k over the course of the last two years of recession (seems a little impossible) and put forth a site plan that I view to be impossible to permit at the DP stage (would violate too many bylaws).  So not only would a builder have to navigate an ugly rezoning process, he would later have to deal with the disappointment of receiving a diminished permit (or maybe a reality based permit). I would forecast a unit reduction of one to two based on what they suggest would be allowed.  This would render the project from marginal to uneconomic because of the elevated land value ($650k was likely too much for the site, so not sure why it is now worth $850k).

As a fall back plan the realtor suggests it is also a great holding/rental property.  At a price/rent ratio of 340 this would be an outrageously terrible investment property.  This would be a good holding property for a landlord that likes to lose $2k per month.  

This is the site plan proposed to be re-used (same as the plan that failed last time).  I made some comments on it in red.  This will be an interesting project to follow.  I will post a new article if it ever sells or someone else tries to develop the site.  

This site plan poses so many setback, water management and grading challenges I would be extremely frightened to consider building it as shown.  I think the real estate board needs to provide some guidance and constraints on realtor advertisement of development potential of a site.  It seems to me that posting misleading listings about theoretical maximum use that has little basis in reality is standard practice in the Calgary real estate market.  I think if a listing agent indicates this is a project that is permissible, that agent should be accountable if the land later turns out to be unusable in the way advertised.  This would drastically reduce the amount of misleading information listing agents would publish.  

Fireplace install

Fireplace install is easily done by the crew we use from Diamond Fireplaces.  They basically come in and set the fireplace on the base we have made and connect the vent kit through the wall.  More complicated installs will require longer vent runs and pose a greater likelihood of inspection failure.

Once placed the framers box the fireplace in, this is as much a theft prevention measure at this point as a design project.  We like to use specials screws that thieves may lack a bit for...

The bigger the project the lesser the consultation requirement?

ROSSCARROCK 1733 & 1733R 33 ST SW and 3500 17 AV SW (DC 128D2014). New: Dwelling Unit, Supermarket, Restaurant: Licensed - Medium, Retail and Consumer Service (mixed use development - commercial podium and 3 apartment buildings, 501 units). DP2015-2086

I happened to stumble upon this notice on the City website. Basically a DP has been issued for the project located at the above address.  What this does not tell you is how major an event this is, and how little the community involvement has been in the project to date.

This is puzzling to me because I had to undertake some serious consultation efforts related to a comparably tiny project, rezoning a 42 ft lot from R2 to RCG.  The DP for the project that the City just permitted is not just 500 condos, it is the redevelopment of the most expensive underground transit hub built in Calgary.  All of this was done with almost zero community involvement, signage, media work, distribution of site plans or drawing, or meetings with the local communities.

I don't mean to suggest I oppose the project. Right now the land is a terrible wasteland of weeds and snowdrifts.  I own a development site just a block from here, and I am very interested in how this mega project can generate more interest in my townhouses.  My townhouses will be very different than what this builder is planning, but the commercial and retail amenities that come along with the project are a big plus.  Lets hope this project turns out really well so it becomes an amenity for my future clients to look at when choosing a home.

I will update the post here if I can locate some drawings of what is being proposed.  Since the DP is approved, the developer has submitted major amounts of design work the the City.  

Update - this is the small amount of publicly available information on the developer website:

The development of Uptown at Westbrook is ongoing and will proceed in several phases over the next 10 years or more. Matco has completed planning at Uptown and has commenced retail leasing. Uptown at Westbrook will become a flagship walkable urban place with residential and commercial buildings master planned within an urban realm specifically designed for the pedestrian. 

The promotional video looks good but not a lot of detail.  Ideally I'd like to know when they will start the project  

Planning for Finishing Carpentry

With the cabinetry design work nearing completion I had a chance to meet with my finishing carpenter. He's been working on numberous projects since I last used his crew at a townhouse project. He told me he had been making improvements to his closet installations so I toured his nearly complete work in a Killarney duplex.  

In the photos below are various closets and foyer installs using mdf material that is prepped for painting.  This project featured many intricate closet built ins and nice design work.  I'll be featuring some of this work in my current project.   

This is similar to the plan I have for my current project at the rear foyer

This is a typical kids bedroom closet. Tall and short hanging rods plus many shelves in the middle.  

This is a very sizeable master bedroom closet. The budget will need to be stretched to accommodate this much finishing work.  

Kitchen Planning

Once the interior and exterior wall framing is finished I like to take final measurements and meet with the kitchen designer to work on specific layout details.  In the case of my current project, I had some ideas on how I wanted the layout to work and positioned the walls in such a way as to make my fridge and pantry unit fit properly.

Once the software comes into play I get a much better idea of the final look of the cabinets.  Once I commit to a cabinet layout I select the various fixtures, generally starting with the flooring, then cabinet door material, countertop, and finally tile. 

This is the current draft of my kitchen, showing the window location and where the ceiling height changes to 10ft.  Overall this is a very practical and european style kitchen. I am pretty sure the eventual buyers of this home will be pleased with the selections.

With a cabinet shop selected we can make the drawings necessary for all the cabinets to be manufactured.  We need to make sure the details work, like the fridge doors can swing without obstruction, and the island fits with the location of our stairs.  This design is nearly complete.

How I Cost Another Builder $25000 in a Flawed Bidding War (and how to avoid this in the future)

A nice (location, aspect, zoning, position in block), yet suboptimal (size) Killarney development site was listed last week and I wanted to purchase it. So did the other builders who specialize in small multifamily projects, some of whom I know as I monitor their projects and we chat occasionally. 

The listing agent was trying to get a bidding war going by withholding offers until Sunday night. This is a trick (not going to legitimize it here by calling it a strategy) used by the realtors to get more money from the builders.  The listing agent gets to know who the offers are coming from and for what amount. The bidders have zero information and take real risks of overpaying based on false information or rumours.  I found out Monday morning that this is exactly what happened.  

I felt the asking price was too much, basically $100,000 more than I recently purchased a comparable lot for (even an arguably better and larger lot). My investing partner was willing to pay up to the $530000 level for the lot so we put that bid in just before the deadline. Unfortunately another builder found out our offer had come in so late and guessed wrongly it was high.  He raised his bid to $575000 from $550000 (a number high enough for the sellers to agree), basically he was now competing against himself to buy the property.  

Obviously the sellers were happy that our near market price offer came in and they leveraged that into getting an extra $25000 over the market value.  This experience has taught me a lot about these phony bidding situation, such as not to get involved, or if you must get involved, find out the other sellers and coordinate offers with them. The realtors are controlling land sales too much and any tactic to undermine that control would be an improvement to the process.  Next time I'm going to make some phone calls and see if we can save some money.  All the builder competition does is shrink already small margins on potentially risky projects.  Adding additional offers that are below asking price will likely drive up the neighbourhood land value and this could harm future deals for everyone.

In the highly speculative market we have now, land prices are way up but the new builds are selling slowly and at a discount.  The builder valuations were estimated when the project was planned (sometimes years earlier) but these prices are not being realized.  It makes no sense to overpay for land now with the expectation that market optimism related to the Trump election and pipeline approvals will improve the market for new homes in 2018.  This optimism could easily dissipate and the pipeline work may not bring meaningful benefits for the Calgary housing market.  This could create a nasty scenario where those builders overpaying for land now are squeezed if the market drops again as it did in all of 2015-16 where builders were working on land purchased at the 2014 peak.  

The good news is the City is finally making some more supply available through the rezoning process.  The key to getting a reasonable deal on land now may be to work on those new areas that have yet to see any multi family building.  This is where I will be focussed.

This is the sale notice.  By the time this came out I had already called another builder and told him what I had bid and why.  His reply was ' I bought it '.  He wasn't particularly pleased that my lower offer had compelled him to overpay.  

Precast stair complete

Having the precast stair installed as early as possible in the process makes a lot of sense to me, especially given the alternative is to use some kind of ramp.  Safe entry to a job site becomes more important as the number of risers increases, but even this job, with just an easy two rise, benefits greatly from early install.

Here is a lengthy but likely not comprehensive list of the benefits of early install of a precast stair at the job site

1. Safer access - in any season, but especially winter, a ramp can get very slippery.  there are many hazards already on a job site so this eliminates a big one
2. Inspector friendly - city inspectors may not enter the project to inspect it without a safe entry in place.  Why bother building a ramp and putting handrails on it when you can just have the precast installed weeks earlier?
3. Deliveries - it is much easier to delivery everything from lumber to pipe if the stairs and landing are in place.  the precast will assist every trade from start to finish with getting tools and material in and out
4. Exterior finishing - the stairs need to be in before exterior work such as stucco or siding goes on.  This way the flashing can be done more accurately around the precast.  
5. Cleaner project - less mud will get tracked into the house
6. Sidewalk planning - once installed the front grades and requirement for the sidewalk is easier to visualize and the precast also needs to be in place before formwork on the stairs can begin

The precast is installed in just a few minutes from a specialized crane on the back of the truck.  We selected a simple broom finish two step unit.  These cost around $1500 to supply and install, much easier than a wood system, and no maintenance required.